Why does a life insurer need an Attending Physician Statement (APS)?

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Why does a life insurer need an Attending Physician Statement (APS)?

We get it – you’re really excited to have your life insurance policy go into effect. Who wouldn’t be? Knowing you’ve got potential income replacement just waiting for your loved ones somewhere down the line...it’s a real rush.

Okay, so maybe it’s not that exciting, but it is very important. It’s not uncommon for you to get a little antsy while you’re waiting for the application and review process to pass. It seems like it lasts forever (even though there are a lot of things that take more time). The last thing you want is to wait around for even longer.

And then you hear that the life insurer is requesting an Attending Physician Statement, or APS.

What is this going to do to your approval timeline?

What is an APS?

First things first: you should know the steps it takes from finding out how much life insurance coverage you need to your policy going into effect.

We could go through every step one by one. Luckily, we’ve provided some pretty pictures to walk you through the process. It’s typically pretty straightforward: after you figure out how much coverage you need, get quotes, and submit an application, you complete a paramedical exam (think of it as a mini medical exam). Once that’s cleared, your final rate is determined and your policy is delivered and goes into effect.

Where things can get tricky is with that paramedical exam – the point where you get a quick physical that helps determine how risky you are for the insurer to cover. That’s when the Attending Physician Statement, or APS, comes into play.

An APS is basically a summary of your medical history from your doctor’s point of view. It has pretty standard health information on it, and it falls under the same HIPAA rules that protect your other medical details. If an issue pops up during your paramedical exam, an APS will let the insurer know if it’s, say, a side effect of some medication you’re taking, or if the cause is an actual medical issue that might have been missed on your application or interview. Insurers need to know what exactly they’re covering with a policy, and an APS sheds light on any ambiguities they might be concerned with.

An insurer will only request an APS if they absolutely have to. It adds an extra step to the underwriting process and it costs the insurance company money. And since it’s on their dime, the insurer doesn’t want to take on any undue costs.

The waiting game

So what does all of this APS talk mean for you?

Well, first of all, it could possibly mean a change to the quote you were originally given. The point of an APS is to provide a more accurate look into your health history, and if it turns out the insurer will have to take on more risk to insure you than it first estimated, then it will need to adjust the policy accordingly.

But that’s only one possible outcome, because the APS can also help the insurer determine that its original assessment of your health was accurate and no adjustments are needed.

Either way, an APS still represents a speedbump in the road for you. A process that usually takes 3 to 4 weeks will probably be extended by at least a couple more weeks.

Why? Bottleneck number one: your doctor. Sadly, you are not always at the center of his or her world. Sick people have a way of taking precedence over paperwork. It’s not a shock if a doctor takes an "I’ll get to it when I get to it" approach (hopefully not being that cavalier about it, but you get the idea). So it will get done – eventually – but you’re on someone else’s timetable now.

After your doctor does fill out the APS, it goes back to the underwriter. They’ll summarize the report, which has its own timeline attached to it. Many underwriters use a template or script to make sure they get all of the important information down as quickly and efficiently as possible. Still, an APS is kind of a big deal, and everything needs to be correct on it, so it’s not something you necessarily want rushed.

*Having to wait on an APS and everything that comes along with it can be tough, but let’s end this on a high note: your health status is important for your coverage and you really want it to be correct! Sure, it adds a little time, but the contestability period for life insurance – the period during which the insurer can cancel your policy if they find any misrepresentations – is typically two years. That’s two years where a mistake can cost you big on protection.

A few extra weeks is nothing if it means that everyone is doing their due diligence and you won’t have to worry about anything coming back to bite you months or years later.

Image: Connor Tarter